Gov. Jerry Brown and state legislative leaders on Monday backed a proposal to hike the statewide minimum wage to $15 an hour by 2023.
Speaking at a news conference at the state Capitol with labor and legislative leaders standing behind him, Brown said the plan would help workers get ahead and laid out details of the proposed legislation.
The plan was agreed to over the weekend after a union-backed initiative to hike the minimum wage to $15 an hour by 2021 qualified for the state ballot last week. Assuming the bill passes the Legislature as expected in coming weeks, that initiative will be withdrawn from the ballot.
The bill would raise the minimum wage in increments, starting with a hike to $10.50 an hour on Jan. 1 for businesses with more than 25 employees. On Jan. 1, 2018, the wage would go to $11 an hour and then increase $1 each year until reaching $25 an hour by Jan. 1, 2022. Businesses with 25 employees or fewer would have an additional year to hit each minimum wage level; all businesses would be paying $15 an hour by Jan. 1, 2023.
In a nod to employer groups that have argued minimum wage hikes fail to take economic conditions into account, the bill contains “off-ramps” to pause wage hikes if negative economic or budgetary conditions emerge. The governor can act by Sept. 1 of each year to pause the next year’s wage increase for one year if there is a forecasted budget deficit of more than one percent of annual revenue or if statewide jobs or retail sales totals decline.
“This plan raises the minimum wage in a careful and responsible way and provides some flexibility if economic and budgetary conditions change,” Brown said.
Senate President-pro-tem Kevin de Leon, D-Los Angeles, said the bill would help 5.6 million California workers currently being paid minimum wage.
“I’m pleased that we have a deal in place that will raise living standards for millions of Californians, while also spurring new demand for goods and services and helping businesses thrive,” de Leon said.
The plan drew opposition from Republican leaders and California Consumers Against Higher Prices, a coalition of business groups, including the California Chamber of Commerce and the California Restaurant Association.
“This plan goes too far,” the coalition said in a statement released minutes after the news conference. “Voters realize the real-life implications of the devastating impacts a $15 minimum wage would have on their lives from education cuts, increased costs to seniors, services for the disabled, and the small businesses and jobs in their neighborhood.”